Retirement Planning Company – Highwood
For those in "Generation X" - described as people born between the mid-1960s and the early 1980s - retirement planning sounds like something your parents or other "old people" would do. But you know what? With lots of "baby boomers" either already in the midst of retirement or viewing it on the horizon, "Generation X" stands out as the next generation of folks to reach old age. Sure, it is a ways off, but people in their 30s and 40s will need to start centering their investment planning on retirement and making certain they've got the type of retirement they are working so hard to have. Here are some tips on planning for retirement:
Retirement life in the foreseeable future will be different than the retirement in the present day. It'll be much better in some ways, and worse somewhat. However, the retirement planning for today's workforce must be far different than it was in the past.
On the bright side, individuals are living longer than ever. As of a few years ago, the average life span of an American was 77.9 years, exactly 2.5 years more than the average life span in 1990 and more than 4 years more than the average life span in 1980. Therefore investment planning for retirement has to account for an extended period of time now than a generation or two back.
Social Security and Retirement - Highwood
On the downside, Social Security will probably be a far less dependable income source compared to now. And the odds are slim-and getting slimmer every year-that retirees 20 and 30 years from now will be able to rely on a work pension and enjoy lifetime benefits from their former employer. More and more, retirees will have to depend on their savings to pay for the expenses of living and health insurance.
With folks living longer and needing more money to do so, retirement planning is a vital activity even for those who are halfway to the standard retirement age of sixty-five. It can be an intimidating task to plan for a few decades into the future, particularly with bills, rents and mortgages to pay right now, but procrastinating will not make it any less complicated.
Putting even just a little bit of money now into a savings account which serves as a retirement savings plan can pay off later on. The interest you get on money in a savings account will allow your preliminary investments to grow to something sustainable. A savings account will supply a place where you can pile up capital earning a small interest rate until there's enough to invest in a reliable security that will yield you more like a municipal bond.
Another solid strategy that can certainly and progressively build a nest egg is to invest in long-term bonds. Upon maturation of the bond, you'll get back your initial investment as well as all the interest which collected over the lifetime of the bond. That's a significant amount of money for a 20- or 30-year bond-money that can provide a nice foundation for retirement. And a municipal or government bond is really as safe an investment as you can ever make.
401K and IRA - Highwood
Nevertheless, the best approach when it comes to retirement planning is to put money in a 401K plan at work or in an IRA opened with an investment house. For the people for whom a 401K isn't a retirement planning option, an IRA is the next best thing. Money put into this account is tax deferred and may be tax-deductible, depending on how much is invested annually.
For more info, please do not hesitate to contact GC Financial Advisors Ltd. at any time and we will be happy to help you! We provide 401K and IRA rollover and review services for individuals in the Highwood area.
